Labour's Keir Starmer and Rachel Reeves. Photo: Labour Party/CC
Labour's Keir Starmer and Rachel Reeves. Photo: Labour Party/CC

Theo Sharieff, Socialist Party Executive Committee

The list of issues landing in the next Labour-led government’s in tray is going to be a long one. But high on the priority list for millions of working-class and young people will be the rotten state of British public services and infrastructure, in some cases literally.

14 years since the unleashing of Tory austerity, the reality of what those policies have meant for public services and working-class people in Britain is abundantly clear. A report by the Progressive Economy Forum last year found that, for the period covering 2010 to 2019, public spending would have been £540 billion higher had austerity not been implemented.

And the result for us? Teachers face longer and longer working hours while schools and other public buildings are left crumbling. Elsewhere, the NHS now faces the highest waiting lists in its history; 9 in 10 NHS dentists no longer accept new patients; and council housing waiting lists are decades long.

Meanwhile, local councils have seen a £15 billion cut to central government funding since 2010. In addition to the slashing of thousands of well-paid and secure jobs for working-class and young people, council-run services have been slashed to the bone.

“More potholes on the roads, fewer bus services, and libraries and leisure centres shutting their doors for good” is how an article in the Guardian looking at council cuts summarised the situation, a statement which no doubt chimes with the day-to-day experiences of millions of working-class people across Britain.

Local authority spending on youth services in England has been cut by £1.1 billion in a decade, down 74% in real terms from £1.48 billion. Between 2009-10 and 2017-18, average per-person spending on social care for the over-65s fell by 31%, leaving more people vulnerable and more pressure on working-class families to make ends meet.

Between 2010 and 2023, spending per person on cultural services was cut by 43% in real terms, by 40% on roads and transport, and by 35% on housing.

Funding has been cut so dramatically that so far since 2020, eight councils have issued section 114 notices, signalling effective ‘bankruptcy’ – limiting spending to statutory services only. But with an estimated 127 more councils threatened with the same in the next five years under a likely Labour-led government, the question of how the crisis in local councils can be fought – and how money stolen from local jobs and services since 2010 can be won back – will be central for working class and young people fighting for their futures.

Privatisation failure

Then there are the other daily reminders of the reality of 21st Century British capitalism. In many now-privatised industries, the lack of investment by the bosses in infrastructure means that simple things which we could once take for granted – such as being able to travel somewhere and to expect to arrive on time – is far from guaranteed, while the fares we pay to use those services are the highest they’ve ever been. Meanwhile, the capitalist class – the individuals who own these industries and services – have gorged themselves on profits.

Despite the fact that this tiny minority are swimming in wealth, most discussions in the capitalist press about the state of Britain’s public services are accompanied by references to the thin ‘fiscal headroom’ of the British government to navigate the approaching period economically. This is especially so since the Truss-Kwarteng mini-budget in Autumn 2022, since when interest rates on new government borrowing have remained higher than for the whole preceding 20 years.

Keir Starmer and shadow chancellor Rachel Reeves have both repeated ad nauseam their priority commitment to ‘iron-clad fiscal discipline’ in government. The ‘fiscal rules’ bogeyman is used to argue that Britain cannot afford to properly fund or even reverse the cuts sustained to public services in the last 14 years.

But what are they and other capitalist politicians and commentators talking about when they refer to these apparently magical ‘fiscal rules’? Why can Britain apparently afford so little?

Fundamentally, they’re talking about what policies are deemed ‘acceptable’ to the capitalist class and their profits in a new era of capitalist crisis. The economic meltdown triggered by the Truss-Kwarteng 2022 mini-budget, which featured the biggest tax cuts for big business since the Second World War against the backdrop of a low-growth British economy, gave a glimpse of what could happen under capitalism when this ‘fiscal headroom’ is ignored.

The ‘markets’, concerned that the UK government may not have been able to meet its debt obligations to investors, demanded higher interest repayments on new government borrowing, sending the bond markets and the wider British economy into a tailspin. Rishi Sunak, assuming the leadership of the crisis-ridden Tory party as a more reliable representative of the interests of the capitalist class, took measures to restore the confidence of the markets, reversing the tax cuts and introducing further brutal cuts to public spending.

With Starmer and Reeves set to take power against the backdrop of continued weak and stagnant economic growth, the capitalist class will continue to demand policies from the pro-capitalist Labour Party which satisfy their interests and profits – again at the expense of the working-class majority and the public services which we still rely on.

None of this alters the fact however that the wealth and resources exist in Britain to provide fully funded and expanded public services, infrastructure, decent housing and jobs for all. The Sunday Times Rich List revealed that in 2023, 171 billionaires owned a combined wealth of £684 billion. A fraction of that wealth could, for example, reverse the cuts to central government grant funding made to local councils since 2010.

But the contradictions of the profit-before-all-else system of capitalism are a block on the mobilisation of those resources. Despite its decline, British capitalism remains the sixth-richest economy on the planet, but it increasingly resembles an emerging economy in terms of its infrastructure and public services.

As the Thames Water scandal last year demonstrated, infrastructure might well have decayed under successive pro-capitalist Tory and New Labour governments, but the money didn’t just turn into steam! While British water companies were racking up collective debts of over £60 billion since privatisation in 1989, and pipes were bursting and pollution increasing, profits totaled a staggering £72 billion in the same period. A socialist society, and the democratic planning by the working class of society’s resources which it would entail, could mean the reinvestment of that wealth back into the service and to bring down our bills.

Do the economic constraints of the capitalist system mean then, that nothing can be done to change things? On the contrary. Mass working-class struggle, particularly when it threatens the stability and rule of the capitalist class itself, can push back attacks, like attacks to public services or cuts to wages, and increase the confidence of working-class people to struggle.

The strike wave, which peaked in March 2023, won pay rises for workers which the bosses originally said were impossible to grant. London Mayor Sadiq Khan found £30 million down the back of the sofa to avert further RMT-organised strikes on London Underground. The public sector general strike in Northern Ireland in January forced the extra funding offered by the Tory government to Northern Ireland of up to £3.3 billion.

Pandemic spending

The experience of the Covid pandemic also demonstrates the measures the capitalist class can be forced to take when their system is threatened. Corbyn’s 2019 manifesto, which proposed an additional £82.9 billion of spending over five years, was mocked and castigated by the big business press and their political allies as ‘unrealistic’ and economically nonsensical, a clear warning to workers and young people who looked towards Corbyn to not dare vote for him.

Yet the outbreak of the pandemic just three months later saw extra spending by the Tory government which dwarfed what was proposed by Corbyn – estimated between £310 and £410 billion – to prop up their rotten system of capitalism.

Much of that money went directly into the pockets of big business. A smaller proportion of it went into the pockets of working-class people for the furlough scheme, which in reality saw workers taking a 20% pay cut.

But all of that spending was necessary from the point of view of the capitalist class to save their system from complete collapse, and to stem the threat of potentially massive explosions of anger from working-class people if such measures weren’t taken. It was tolerable for capitalism, on the condition that the working-class majority be made to pay for those emergency measures through further austerity attacks.

Class struggle

Looking forwards, the most important thing now is that the workers’ movement prepares for the bold fight which will be necessary to struggle for the funding our public services need, including above-inflation pay rises in the public sector under a Starmer-led government.

That means not only preparing for the fight industrially, but politically as well. Workers’ candidates who could clearly answer the lie, repeated time and again in Parliament and the council chambers by Starmer and all shades of pro-capitalist politicians, that the money doesn’t exist in society to provide working-class and young people with a decent standard of living.

But any of these hard-fought-for gains – be it extra funding for the NHS or above-inflation pay rises – would inevitably be temporary on the basis of crisis-ridden capitalism, and pose the need to fight for a fundamental socialist transformation of society.

The basis of that transformation would start with the nationalisation of the banks, finance houses and monopolies which dominate the British economy under democratic workers’ control and management, with compensation paid out only on the basis of proven need.

With those resources in the hands of the working-class majority, the potential to finally mobilise society’s resources where they’re desperately needed would finally be unlocked. The Institute for Public Policy Research in summer 2023 published a report which found public sector investment trailed the G7 median by £208.4 billion between 2006 and 2021. Additionally, private sector investment since 2005 in Britain was £354.3 billion below the G7 average. Taken together, that’s £562.7 billion the bosses and their political representatives have refused to reinvest – the equivalent of 30 Elizabeth Line developments!

Publicly owned services and infrastructure – water, mail, the NHS, housing, roads, rail lines, as well as cultural services – on a socialist basis, could be given the investment they’ve been starved of for decades. This could create millions of socially necessary and well-paid jobs, and be linked to a socialist green transition to reverse capitalist-driven environmental destruction.

A socialist society wouldn’t only mean the harnessing and planned rational use of the wealth and resources which have accumulated and exist under capitalism currently, but through a massive expansion of investment would massively lift productivity and increase the size of the ‘real’ economy and the potential for the further development of society.

With the economic levers of power democratically resting in the hands of the working class, other decisions considered ‘no-goes’ under capitalism could be made. In 2020, total UK government debt totalled £2 trillion. Of that debt, 18% was owned by foreign investors and 35% was owned by UK-based banks, building societies, pension and insurance funds. And in 2022-23, 9.7% of all government spending – £112 billion – went towards interest repayments on government-owned debt. Why should that money continue to line the pockets of the super-rich in Britain and around the world, instead of being put to use to meet the needs of the majority in Britain and internationally?

This would also raise the need for a struggle against the system of capitalism globally. However, with the example of what thoroughgoing socialist measures would mean for the mass of working-class and young people here in Britain, the potential would exist for it to spread like wildfire across the globe.

The experiences of the struggles which will inevitably develop under a Starmer-led government for adequately funded and high-quality public services and wage rises will provide massive lessons not only in the potential gains mass collective working-class action can achieve under capitalism, but also for the need for an entirely new kind of system, based on the democratic planning of society’s resources to meet the needs of all. Join the Socialist Party in that fight.